India gold demand could recover during Q4 on festival shopping: World Gold Council
[MUMBAI] India's gold demand in the fourth quarter is expected to recover after falling 30 per cent in the previous quarter as festivals are expected to strengthen retail jewellery purchases, the World Gold Council (WGC) said on Thursday.
"We expect quarter four would be better than quarter three due to pent-up demand and festivals," said Somasundaram PR, the managing director of WGC's Indian operations.
Demand for the precious metal usually spikes towards the end of the year in India, as buying gold for weddings and major festivals such as Diwali and Dussehra is considered auspicious.
Indians celebrated Dussehra earlier this month and jewellers reported improvement in footfalls and sales, said Mr Somasundaram.
But demand during fourth quarter would still be lower than the 194.3 tonnes recorded last year as consumers are struggling to adjust to near record high prices, he said.
India's gold demand in the first three quarters fell 49 per cent from a year earlier to 252.4 tonnes as coronavirus-triggered lockdowns hit jewellery demand, the WGC said in a report published on Thursday.
GET BT IN YOUR INBOX DAILY
Start and end each day with the latest news stories and analyses delivered straight to your inbox.
In the third quarter, gold demand fell 30 per cent from a year earlier to 86.6 tonnes as jewellery demand plunged 48 per cent to 52.8 tonnes in the same period, the WGC said.
While overall gold consumption fell, demand for coins and bars, known as investment demand, jumped 51 per cent in the third quarter as rising prices attracted investors, the WGC said.
"The slowdown in real estate and rising gold prices may have prompted unaccounted cash holders to move into gold," it said.
Scrap gold supplies jumped to 41.5 tonnes in the third quarter, the highest in seven years, as record prices and stress on household finances prompted consumers to liquidate their old trinkets and jewellery, according to the WGC.
REUTERS
KEYWORDS IN THIS ARTICLE
BT is now on Telegram!
For daily updates on weekdays and specially selected content for the weekend. Subscribe to t.me/BizTimes
Energy & Commodities
India's Vedanta misses Q4 profit estimates on lower prices
BHP targets Anglo American in bid valuing miner at US$39 billion
China's Sinopec charts global expansion with refinery in rival India's backyard
Gold trades in tight range as market focuses on US economic data
Oil settles lower as US business activity cools, concerns over Middle East ease
Orsted says Taiwan wind project to power TSMC on track for 2025 finish